The decentralized autonomous organization (DAO) behind the Ethereum layer-2 network Scroll said it will propose a plan to dissolve the Security Council and transfer control of the network to an account managed by an internal team.
The announcement of the proposal comes two months after Scroll’s main fee-generating decentralized application (dapp), crypto neobank Ether.fi, moved to Optimism’s OP mainnet. That caused approximately 300,000 user accounts and more than $160 million in total value to move off the network.
In a board update, a core Scroll contributor said the Security Council was simply too expensive. Scroll is laying off several employees within the DAO and reducing the capacity of its operating committees. The transfer is planned for the next ten days, pending support from the current council.
“After evaluating the costs of the Security Council in relation to its actual use in recent quarters, we believe that its continuation is no longer justified,” the message reads.
The project said all contract changes would be implemented transparently and remain verifiable in the chain.
Adding to the turbulence on the network, a recent increase in Scroll’s network costs was artificially manufactured rather than a sign of organic demand.
For six days in early April, the network increased the amount it charges to publish data on the Ethereum mainnet by a factor of 1,280, creating the illusion of a huge spike in 30-day chain fee momentum, according to L2BEAT analysis.
The change forced users to pay more than $50,000 in additional transaction fees for posting data, which would normally have cost around $280. The extreme, temporary price revision was reversed on April 9.
According to DeFiLlama data, Ether.fi’s migration has removed approximately $13 million in annualized costs from Scroll, and reduced the network’s TVL to approximately $23 million.